When Consumers Have Asymmetric Information and When Search Costs and the Number

question 1

Multiple Choice

When consumers have asymmetric information and when search costs and the number of firms are large,a single-price equilibrium in a competitive market

• A) is impossible.
• B) occurs when price equals average cost.
• C) occurs when price equals marginal cost plus the search cost.
• D) occurs when the price is the price a monopoly would set.

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